Redistribution Schemes: Why the “Project-to-Subsale” Commission Model Is Obsolete
A decade ago, Malaysia’s real estate agencies often used what was called a Redistribution Commission Scheme — a layered system where commissions from project sales were routed through the subsale structure again.
It started as a practical workaround, but it quickly became one of the biggest sources of agent dissatisfaction and, critically, high talent turnover.
How the Redistribution Model Crippled Incentives
When project teams were short-staffed, agencies would "borrow" negotiators from the subsale division to help close project units. While this filled a short-term manpower gap, it created a long-term fairness disaster.
Each project sale already carried a built-in company profit and commission structure. But when a subsale negotiator closed a project deal, their commission had to run through the subsale scheme again, triggering:
- Another layer of uplines taking overrides (often leaders completely unrelated to the project lead generation).
- Another round of company profit deduction (the "second cut").
In effect, the closer’s portion was double-taxed—once under the project scheme and again under the subsale scheme.
This redistribution was originally justified because subsale leaders demanded recognition when their team members assisted project launches.
Why the Model Failed the Test of Time
The redistribution model looked "fair" on paper—everyone got something—but it was administratively heavy and emotionally fragile. While it worked when agencies relied on manual accounting and goodwill, agencies eventually discovered its hidden cost: systemic agent churn.
Closing agents—the people who actually brought in the revenue—began leaving because they felt penalized for their success.
Here’s the breakdown of the failure:
- Perception of Unfairness: Closers saw their hard-earned commissions shrink twice for the same effort, while uplines and unrelated parties still claimed a share. This destroyed trust.
- Low Morale, High Turnover: Top performers, who understood their market value, simply moved to competing agencies that offered cleaner, single-tier project schemes.
- Recruitment Difficulty: Negative word spread quickly; the redistribution model became a toxic brand for new recruits.
Ultimately, the system collapsed under its own weight because it lost the confidence of the people doing the work.
The Industry Shift: Clarity Beats Complexity
Modern, competitive agencies have decisively shifted to designing commission schemes that are direct, transparent, and single-tier.
Each role—lister, closer, leader—gets credited once, not twice.
If collaboration happens across subsale and project divisions, it's handled through:
- Role-Based Crediting: Where the system automatically credits based on contribution (e.g., who sourced the lead, who closed the deal).
- Project-Specific Overrides: Pre-agreed bonuses paid to leaders for lending their team, not a full re-routing through the subsale split.
This shift isn't just about software—it’s about trust economics. When agents believe the system is transparent and fair, they stay longer, sell more, and attract better peers, creating a sustainable competitive advantage.
Final Thought
The redistribution model belonged to an era where manpower was borrowed and fairness was negotiated.
Today, in a high-churn, competitive industry, clarity beats complexity. Agents no longer tolerate being double-taxed for their success.
The message for agency bosses is simple: Reward the closer, respect contribution, and design your commission system to keep your best people—not push them to your competitors.
